Best Debt Consolidation in Cincinnati, OH

How to choose debt consolidation in Cincinnati

Cincinnatians have an average of $19,491 in student debt and $5,446 in credit card debt. Cincinnati residents also have an average of $1,449 in medical debt in collections. These monthly payments are a heavy burden for many households, especially when the debts have high interest rates.

Debt consolidation, which refers to a broad category of debt relief services, is one way to get a handle on unmanageable debt and avoid bankruptcy. One of the most common debt consolidation services in Cincinnati is debt settlement. This solution only applies to unsecured debt that does not have collateral, such as personal loans and credit card debt.

In debt settlement, the debt consolidation company negotiates with the creditor for a reduced lump sum payment. Most debt relief companies in Cincinnati prefer a minimum debt of $10,000 to qualify for their services. On average, it can take two to four years to settle debt using this approach.

Debt relief companies can't charge any upfront fees, but they do charge a fee for their services once the debt is settled. Some fees you may be charged after settlement include:

• Setup fee: After the debt is settled, you may see a small fee on your bill to cover the costs of the initial account setup.
• Monthly fees: During the negotiation process, the company may require that you stop payments to the creditor and instead deposit the funds into a dedicated account that may come with monthly maintenance fees.
• Service fees: This is the most substantial cost of the debt settlement process. Most settlement companies charge a percentage of the amount settled, usually from 15 to 25 percent. Some calculate this fee using the amount settled, while others look at the amount of debt eliminated.

If you don't have enough debt to qualify for debt consolidation services, there are other options available. You can take out a personal or home equity loan, transfer balances to a credit card with a 0 percent introductory rate or contact debt relief companies for counseling services.

Some companies in Cincinnati are scams or falsely advertise debt relief programs. To confirm a company’s reputation, you can view any complaints filed against them with the Ohio Attorney General. If you believe such a company has contacted you, you can report a scam to the Ohio Attorney General.